EMPLOYMENT AGREEMENT
THIS AGREEMENT is entered into on the 31st day of May, 1996, by and
between OTTO P. JONS, whose address is 11742 Gainsborough Road, Potomac,
Maryland 20854 (herein called the "Employee"); and ADVANCED MARINE
ENTERPRISES, INC., a Virginia corporation ("AME"), whose address is 1725
Jefferson Davis Highway, Suite 1300, Arlington, Virginia 23202; and NICHOLS
RESEARCH CORPORATION, a Delaware corporation ("NRC"), whose address is 4040
South Memorial Parkway, Huntsville, Alabama 35802.
W I T N E S S E T H:
WHEREAS, this Agreement is executed on the date of the closing of that
certain Stock Purchase Agreement by and among NRC, the Employee and the
other shareholders and optionholders of AME (the "Purchase Agreement")
whereby AME became a wholly owned subsidiary of NRC;
WHEREAS, AME is engaged principally in providing naval and marine
architectural and engineering services, including the development and
support of analytic software systems, modeling and simulation services and
simulator systems, to the Department of Navy and other customers (the "AME
Business");
WHEREAS, the Employee has valuable knowledge and experience related to
the AME Business; and
WHEREAS, AME desires to obtain the services of the Employee as
Executive Vice President of AME and the Employee is willing to render such
services to AME upon the terms and conditions herein set forth;
NOW, THEREFORE, in consideration of the mutual promises set forth
herein and other good and valuable consideration, the receipt of which is
hereby acknowledged, the parties agree as follows:
1. DUTIES.
Subject to the terms and provisions of this Agreement, AME hereby
employs Employee and Employee hereby accepts employment by AME as Executive
Vice President of AME. The Employee's duties shall include the duties and
responsibilities identified on Schedule I attached hereto. The Employee
shall perform such other tasks and duties as may be assigned by AME from
time to time, consistent with the Employee's training and experience and
with the position of Executive Vice President of AME. The Employee shall
devote his full time, attention, skill and efforts to the tasks and duties
assigned by AME. The Employee shall carry out his duties under the general
supervision of the Board of Directors of AME. The Employee hereby agrees
to undertake such travel as may be required in the performance of his
duties. The reasonable travel expenses of the Employee shall be reimbursed
in accordance with AME's reimbursement policy in effect from time to time.
The Employee shall not be required to relocate from the Arlington,
Virginia, area without his consent.
2. COMPENSATION.
(a) BASE SALARY. AME shall pay the Employee a base monthly salary of
$20,417 per month through August 31, 1996, and a base monthly salary of
$16,667 per month thereafter payable during the Term of Employment, as
hereinafter defined, in accordance with the standard payroll practices of
AME. Beginning September 1, 1997, such salary may be increased from time
to time in the discretion of the AME Board of Directors consistent with NRC
executive compensation practices.
(b) PERFORMANCE BONUSES. No performance bonus shall be paid for the
fiscal period ending August 31, 1996. Subject to the limitation of Section
2(d) below, during the three year period commencing September 1, 1996, and
ending August 31, 1999, the Employee shall be entitled to an annual
performance bonus, if any, equal to the sum of (1) two percent (2%) of
AME's Earnings Base (as hereinafter defined) up to an Earnings Base of
$4,000,000 if the Earnings Base exceeds $1,000,000 and (2) three and one-
half percent (3-1/2%) of the amount by which the Earnings Base exceeds
$4,000,000. Commencing September 1, 1999, Employee shall be entitled to
participate in the performance bonus plan, if any, currently maintained by
NRC and described in Section 2.9 of the NRC policy manual on a basis
consistent with the manner in which corporate vice presidents of NRC
benefit under such plan.
(c) INCENTIVE PAYMENTS. Subject to the limitation of Section 2(d)
below, the Employee shall be entitled to receive incentive payments, if
any, as follows:
(i) $150,000 for the fiscal year ending August 31, 1997, if
during such fiscal year AME achieves an Earnings Base
of at least $3,000,000;
(ii) Either $75,000 for the fiscal year ending August 31,
1998, if during such fiscal year AME achieves an
Earnings Base of at least $3,350,000, but less than
$3,764,999, or $150,000 for the fiscal year ending
August 31, 1998, if during such year AME achieves an
Earnings Base of at least $3,765,000.
(d) LIMITATION ON PERFORMANCE BONUS AND INCENTIVE PAYMENT. The
Employee shall be entitled to the greater of the performance bonus under
Section 2(b) above or the incentive payment under Section 2(c) above for
each such fiscal year, but not both. The Employee understands that he may
be entitled to neither a performance bonus nor an incentive payment if AME
does not achieve the Earnings Base required under Section 2(b) or 2(c)
above.
(e) EARNINGS BASE. The "Earnings Base" shall mean AME earnings for
the fiscal year ended August 31 before interest, income taxes and
amortization of good will, except that (i) working capital advances from
NRC to AME in excess of $1,000,000 shall bear interest at the commercial
base rate of interest announced by SouthTrust Bank from time to time and
such interest shall be treated as an expense of AME in determining Earnings
Base, and (ii) AME shall be allocated an NRC corporate charge of no more
than 2.05% of AME value added costs which shall be treated as an expense of
AME in determining Earnings Base. There shall be excluded from the
computation of Earnings Base the revenue and expenses of any business unit
not within AME's current business organization unless the Employee and John
T. Drewry consent to the inclusion of such business unit. There shall be
excluded from the computation of Earnings Base AME expenditures directed by
NRC or AME which are not related to or connected with AME's Business unless
the Employee and John T. Drewry consent thereto. For purposes of
determining Earnings Base, all compensation and other costs of this
Agreement and that certain employment agreement of John T. Drewry of even
date herewith shall be expenses of AME and not NRC. For this purpose,
"value added costs" are all costs except payments to subcontractors and
payments for contract materials. The determination of Earnings Base shall
be made in accordance with generally accepted accounting principles
("GAAP") as consistently applied by AME, except as modified by the
preceding language. The following procedures shall be observed in the
determination of gross revenues and Earnings Base:
(i) NRC's Chief Financial Officer ("CFO") shall prepare and
deliver to Employee a proposed statement for each fiscal
year ending August 31, 1997, 1998, and 1999 within forty-
five (45) days of the end of such fiscal year, setting forth
in reasonable detail the basis for the calculation.
Employee and his accountants shall have the right to consult
with the appropriate personnel of NRC, AME and their agents
and shall have the right to examine on a concurrent basis
any and all work papers, schedules and other documents
prepared by AME, NRC or their accountants in connection with
the proposed statement of gross revenues and Earnings Base.
(ii) Employee may dispute the proposed gross revenues and
Earnings Base statement by notifying AME in writing setting
forth in reasonable detail, to the extent possible, the
amount(s) in dispute and the basis for such dispute, within
thirty (30) days of Employee's receipt of the proposed
statement. In the event of such a dispute, the CFO and
Employee's accountants shall attempt in good faith to
resolve such dispute, and any resolution by them as to any
disputed amount(s) shall be final, binding and conclusive on
Employee, AME and NRC.
(iii) If Employee's accountants and the CFO do not resolve any
such dispute within fifteen (15) days of the date of receipt
by AME and NRC of Employee' written notice of dispute, the
CFO and Employee's accountants shall, within five (5)
additional days, submit any such unresolved dispute to an
independent accounting firm of national reputation appointed
jointly by Employee and AME (neither of which may
unreasonably withhold or delay such appointment) (the
"Independent Accounting Firm"), which firm shall, within
forty (40) days of each submission, resolve each such item
remaining in dispute within the range of amounts proposed by
Employee and the CFO, and such resolution shall be binding
and conclusive on Employee, AME, and NRC. The fees and
disbursements of the Independent Accounting Firm ("IAF")
shall be borne 100% by AME if the Employee is successful
with respect to at least thirty-five percent (35%) of the
aggregate amount of disputed items submitted to the IAF.
Otherwise, such fees and disbursements shall be borne 75% by
the Employee and 25% by AME. Any payment by AME to the IAF
shall be excluded from the determination of the Earnings
Base if the Employee is successful with respect to at least
thirty-five percent (35%) of the disputed amount.
(f) STOCK OPTIONS. The Employee shall receive a stock option grant
on September 3, 1996, to purchase 12,000 shares of NRC common stock at a
price equal to the fair market value of such stock on the date of grant
provided Employee is employed by AME or NRC on such date. The stock
options shall be subject to the terms and conditions contained in the NRC
1991 Stock Option Plan, including vesting, exercise and nontransferability,
as the same may be amended from time to time. To the extent possible, such
option shall be designated an incentive stock option.
(g) FRINGE BENEFITS. The Employee shall participate in any group
health insurance, vacation and sick leave plans, and other benefit plans
available to employees of AME generally in accordance with their terms and
conditions which plans may be amended or terminated by AME at any time.
The excess disability and excess ($200,000) life insurance policies for the
benefit of the Employee in effect prior to the closing of the Purchase
Agreement shall be cancelled one year from the date hereof, unless assigned
pursuant to the following sentence. If requested in writing by the
Employee, such excess life insurance policy and such disability insurance
policy shall be assigned by AME to the Employee, provided the same have not
lapsed and may be assigned by their terms. The AME company automobile
assigned to Employee prior to the closing of the Purchase Agreement shall
continue to be afforded Employee under the existing terms and provisions
relating to use of such vehicle by Employee for a period of three years
from the date hereof. The Employee shall have the option after three years
from the date of this Agreement to purchase the automobile from AME for a
price not to exceed the net book value determined by GAAP consistently
applied by AME, provided the Employee reimburses to AME any amounts
determined by Defense Contract Audit Agency to be unallowable and therefore
non-reimbursable under government contracts. Such option to purchase the
automobile shall lapse and be null and void if not exercised within thirty
(30) days after the third anniversary date hereof by tendering the purchase
price to AME.
3. TERM OF EMPLOYMENT.
This Agreement shall commence on the date hereof and shall end five
(5) years from such date (the "Term of Employment"), unless terminated
earlier as provided in Section 4 below, or extended as provided in this
Section 3. Upon expiration of the initial Term of Employment, unless
earlier terminated as provided herein, the Employee's employment shall
continue automatically month-to-month until terminated by either party with
at least thirty (30) days' prior written notice with or without cause.
4. TERMINATION BEFORE EXPIRATION OF TERM OF EMPLOYMENT.
The termination of the employment of the Employee during the initial
Term of Employment may be effected in one of the following ways:
(a) BY AME, FOR CAUSE. Termination by AME shall be deemed to be for
cause only upon:
(i) Employee's conviction of or pleading guilty to a felony or
debarment regarding federal contracts;
(ii) Refusal or failure by the Employee, without reasonable
excuse or proper authorization, to carry out any reasonable
instructions of AME consistent with Employee's rights or
duties as set forth in this Agreement;
(iii) Material breach of this Agreement;
(iv) The Employee's willful misconduct in the execution of his
duties, including without limitation breach of fiduciary
duty, dishonesty, theft of company property or the breach of
the duty of loyalty owed AME.
If AME intends to terminate for cause, AME shall provide notice to
Employee of intent to terminate his employment, stating the termination
provision in this Agreement relied upon and setting forth in reasonable
detail the facts and circumstances claimed to provide a basis for
termination under the provisions so indicated, and shall provide Employee
with an opportunity to cure the alleged default or breach within thirty
(30) days of receipt of the notice, provided that if the matter is not
curable within such thirty (30) day period, the Employee shall not be
deemed in default if the Employee commences immediately to cure the matter
and proceeds diligently thereafter to complete the cure, further provided
that the alleged breach or default must be cured within ninety (90) days of
receipt of the notice. AME shall not be required to give more than one
notice with respect to the same matter. Notwithstanding the foregoing, no
notice and no cure right shall be required with respect to termination for
cause under 4(a)(i) or 4(a)(iv).
(b) BY AME, WITHOUT CAUSE. Any termination of Employee by AME for
reasons other than as set forth in subsections 4(a), (e), (f) or (g) shall
be a termination without cause. AME may terminate the employment of
Employee without cause by thirty (30) days' prior written notice at any
time.
(c) BY EMPLOYEE, FOR GOOD REASON. Termination by the Employee shall
be deemed for good reason only because of a material breach by AME of this
Agreement. In all cases in which Employee intends to terminate for Good
Reason, the Employee shall provide AME with notice of intent to terminate
this Agreement, stating the facts and circumstances giving rise to a breach
of this Agreement claimed to provide a basis for termination under the
provisions so indicated, and shall provide AME with an opportunity to cure
the alleged default or breach within thirty (30) days of receipt of the
notice, provided that if the matter is not curable within such thirty (30)
day period, AME shall not be deemed in default if it commences immediately
to cure the matter and proceeds diligently thereafter to complete the cure,
further provided that the alleged breach or default must be cured within
ninety (90) days of receipt of the notice. Employee shall not be required
to give more than one such notice with respect to the same matter.
(d) BY THE EMPLOYEE, WITHOUT GOOD REASON. Any termination by
Employee for reasons other than as set forth in subsections 4(c), (e), (f)
or (g) shall be a termination without good reason. The Employee may
terminate his employment without good reason upon thirty (30) days' prior
written notice at any time.
(e) DEATH OF THE EMPLOYEE.
(f) DISABILITY OF EMPLOYEE. If, during the Term of Employment, a
physician selected by AME and the Employee determines that the Employee has
become physically or mentally disabled so as to be unable to carry out the
normal and usual duties of his employment for six (6) continuous months,
and reasonable accommodation cannot be made to allow the Employee to
continue to perform his duties full-time, his employment hereunder may be
terminated at the election of AME or the Employee.
(g) MUTUAL CONSENT. The parties by mutual consent may terminate
Employee's employment.
5. CONSEQUENCES OF TERMINATION.
The termination of the employment of Employee will cause the following
results:
(a) PAYMENTS ON CERTAIN TERMINATIONS; LIQUIDATED DAMAGES FROM
EMPLOYEE. If the termination is by AME under Section 4(a) above, or is by
the Employee under Section 4(d) above, the following payments shall be
made:
(i) AME will pay the Employee within five (5) days after the
date of termination any unpaid base monthly salary under
Section 2(a) prorated to the date of termination, the amount
of any accrued annual vacation pay to which he may be
entitled under AME's vacation plan and benefits, with such
compensation and benefits (if any) paid only through the
date termination occurs.
(ii) If such termination occurs within the first twenty four (24)
months of this Employment Agreement, the Employee shall pay
to AME as liquidated damages and not as a penalty an amount
equal to the product of the base monthly salary under
Section 2(a) on the date of termination multiplied by six
(6). If such termination occurs after the first twenty-four
(24) months of this Employment Agreement, there shall be
substituted for six (6) in the first sentence of this
Section 5(a)(ii) above the appropriate number set forth
below:
(A) four (4), if termination occurs after the second
year and prior to the third year;
(B) two (2), if termination occurs after the third
year and before the fourth year; and
(C) zero (0), if termination occurs after the fourth
year.
The liquidated damages may be prepaid. For example, if
employment is terminated 24 months after the date hereof,
the liquidated damages would be $66,668 ($16,667 X 4). The
liquidated damages shall be paid in 12 equal, consecutive
monthly installments without interest commencing 30 days
after termination, provided that, if any monthly installment
is not paid within 10 days after notice of default, the
entire amount of liquidated damages shall be paid in lump
sum immediately.
(b) PAYMENTS ON CERTAIN TERMINATIONS; LIQUIDATED DAMAGES FROM AME.
If the termination is by AME under Section 4(b) above, or is by the
Employee under Section 4(c) above, AME shall pay to the Employee, in
addition to the amounts set forth in 5(a)(i) above, as liquidated damages
and not as a penalty, the following amounts:
(i) If such termination occurs within the first eighteen (18)
months of this Employment Agreement, an amount equal to the
product of the base monthly salary under Section 2(a) on the
date of termination multiplied by the greater of (A) six or
(B) twenty-four minus the number of full months of
employment by the Employee on the date of termination. If
such termination occurs after the first eighteen (18) months
of this Employment Agreement, an amount equal to the product
of base monthly salary under Section 2(a) on the date of
termination multiplied by the lesser of (A) six or (B) the
number of full months remaining after the date of
termination until expiration of the initial Term of
Employment assuming the Term of Employment is not terminated
early. For example, if employment is terminated two years
after the date hereof, the liquidated damages would be
$100,002 ($16,667 X 6). The liquidated damages shall be
paid in 12 equal, consecutive monthly installments without
interest commencing 30 days after termination, provided
that, if any monthly installment is not paid within 10 days
after notice of default, the entire amount of liquidated
damages shall be paid in lump sum immediately. The
liquidated damages may be prepaid.
(ii) If such termination occurs prior to August 31, 1998, the
full amount of the performance bonus under Section 2(b)
hereof or the incentive payment under Section 2(c) hereof
shall be paid to Employee if AME achieves the financial
performance required under Section 2(b) or Section 2(c)
which would entitle the Employee to such payment if his
employment had not terminated after application of the
limitation under Section 2(d) hereof.
(c) MUTUAL GROUNDS FOR TERMINATION OR CONSENT. If the parties
mutually agree to terminate under Section 5(g), neither party shall owe the
other party the liquidated damages set forth above in Sections 5(a)(ii) or
5(b).
(d) DEATH OR DISABILITY. In the event of the Employee's death or
disability, the following provisions will apply:
(i) Upon his death, the Employee's estate will be entitled to
receive the amount set forth in Section 5(a)(i) and the
benefits set forth in any plans of AME then in effect and
applicable under the circumstances. The Employee or his
estate shall be entitled to no other compensation or
benefits in the event of death other than the right of the
Employee's estate to exercise any or all stock options
exercisable but not yet exercised during the period of three
(3) months after the date of death.
(ii) Upon termination on account of disability, Employee will be
entitled to receive the amount set forth in Section 5(a)(i)
and the benefits set forth in any plans of AME then in
effect and applicable under the circumstances. The Employee
or his personal representative shall be entitled to no other
compensation or benefits in the event of disability, except
as provided in Section 5(f) of the NRC 1991 Stock Option
Plan.
(e) MITIGATION. The Employee shall not be required to mitigate the
amount of payment provided for in this Section 5 by seeking employment.
(f) RELEASE. The amounts set forth above in this Section 5 shall be
paid and received in complete release and discharge of any other obligation
under this Employment Agreement of AME or NRC to Employee or Employee to
AME or NRC resulting from termination of his employment, except that the
provisions for termination herein contained shall not affect the rights and
remedies of AME or NRC under Section 9 hereof. The provisions of Sections
6, 7 and 9 shall survive any termination of employment.
(g) TERMINATION AFTER FIVE YEARS. After the initial Term of
Employment of five years, only the amounts specified in Section 5(a)(i)
shall be due the Employee upon termination and neither party shall be
liable for any other payment hereunder.
6. NON-DISCLOSURE COVENANTS AND PROPRIETARY MATTERS.
(a) NONDISCLOSURE OF CONFIDENTIAL INFORMATION. Unless authorized or
instructed in writing by AME, the Employee shall not, except as required in
the conduct of AME's business or in response to a lawful subpoena or
discovery order or as may otherwise be required by law during or at any
time after the Term of Employment, disclose to others or use any of AME's
inventions or discoveries or its respective secret or confidential
information or data (oral, written, or in machine readable form) which the
Employee may obtain during the course of or in connection with the
Employee's employment (or employment or affiliation with any company that
transfers to AME such information or data), including such inventions,
discoveries, information or data relating to machines, equipment, products,
systems, software, contracts, contract performance, research or
development, designs, computations, formulas, manufacturing procedures,
prices and earnings, customer lists, and suppliers, whether or not
developed by the Employee, by others in AME or obtained by AME from third
parties, and irrespective of whether or not such inventions, discoveries,
information, knowledge or data have been identified by AME as secret or
confidential, unless and until, and then to the extent and only to the
extent that, such inventions, discoveries, information, knowledge or data
become available to the public otherwise than by the Employee's act or
omission.
(b) PATENTS. The Employee agrees to disclose immediately to AME or
any persons designated by it and to assign to AME or its successors or
assigns, all inventions made, discovered, or first reduced to practice by
the Employee, solely or jointly with others, during the Term of Employment
or within a period of six months from the date of termination of such
employment (either during or outside of the Employee's working hours and
either on or off AME's premises as it relates to the subject matter of
employment), which inventions are made, discovered or conceived either in
the course of such employment, or with the use of AME's time, material,
facilities or funds, or which are directly related to any investigations or
obligations undertaken by AME; and the Employee hereby grants and agrees to
grant the right to AME and its nominees to obtain, for its own benefit and
in its own name (entirely at its expense) patents and patent applications
including original, continuation, reissue, utility and design patents, and
applications, patents of addition, confirmation patents, registration
patents, petty patents, utility models, and all other types of patents and
the like, and all renewals and extensions of any of them for those
inventions in any and all countries; and the Employee shall assist AME, at
AME's expense, without further charge during the term of the Employee's
employment, and after termination of the Employee's employment to the
extent such assistance does not unreasonably interfere with the Employee's
performance of subsequent employment, at the same base salary rate
(excluding any bonuses, incentive or deferred compensation or other
benefits and based upon a forty hour work week) as during the last year of
the Employee's employment (determined on an hourly basis for this purpose),
through counsel designated by AME, to execute, acknowledge, and deliver all
such further papers, including assignments, applications for Letters Patent
(of the United States or of any foreign country), oaths, disclaimers or
other instruments and to perform such further acts, including giving
testimony or furnishing evidence in the prosecution or defense of appeals,
interferences, suits and controversies relating to any aforesaid inventions
as may reasonably be deemed necessary by AME or its nominees to effectuate
the vesting or perfecting in AME or its nominees of all right, title and
interest in and to said inventions, applications and patents.
(c) COPYRIGHTS. The Employee agrees to disclose immediately to AME
or any persons designated by it and to assign to AME, at its option, or its
successors or assigns, all works of authorship, including all writings,
computer programs, software, and firmware, written or created by the
Employee solely or jointly with others, during the course of his employment
by AME (either during or outside of the Employee's working hours and either
on or off AME's premises as it relates to the subject matter of
employment), which works are made or conceived either in the course of such
employment, or with the use of AME's time, material, facilities or funds,
or which are directly related to any investigations or obligations
undertaken by AME; and the Employee hereby agrees that all such works are
works made for hire, of which AME is the author and the beneficiary of all
rights and protections afforded by the law of copyright in any and all
countries; and the Employee will assist AME at AME's expense without
further charges during the term of his employment, and after termination of
his employment to the extent such assistance does not unreasonably
interfere with the Employee's performance of subsequent employment, at the
same base salary rate (excluding any bonuses, incentive or deferred
compensation or other benefits) as during the last year of his employment
(determined on an hourly basis for this purpose assuming a forty hour work
week), through counsel designated by AME, to execute, acknowledge, and
deliver all such further papers, including assignments, applications for
copyright registration (in the United States or in any foreign country),
oaths, disclaimers or other instruments, and to perform such further acts,
including giving testimony or furnishing evidence in the prosecution or
defense of appeals, interferences, suits and controversies relating to any
aforesaid works, as may be deemed necessary by AME or by its nominees to
effectuate the vesting or perfecting in AME or its nominees of all rights
and interest in and to said works and copies thereof, including the
exclusive rights of copying and distribution.
(d) RECORDS. The Employee shall keep complete, accurate and
authentic accounts, notes, data and records of all inventions made,
discovered or developed and all works of authorship written or created by
the Employee as aforesaid in the manner and form requested by AME.
(e) RETURN OF AME PROPERTY. All computer or other hardware, computer
software, computer programs, source codes, object codes, magnetic tapes,
printouts, samples, notes, records, reports, documents, customer lists,
photographs, catalogues and other writings, whether copyrightable or not,
relating to or dealing with AME's business and plans, and those of others
entrusted to AME, which are prepared or created by the Employee or which
may come into his possession during or as a result of his employment, are
the property of AME, as applicable, and upon termination of his employment,
the Employee agrees to return all such computer software, computer
programs, source codes, object codes, magnetic tapes, printouts, samples,
notes, records, reports, documents, customer lists, photographs, catalogues
and writings and all copies thereof to AME. The Employee is not required
to turn over personal notes unnecessary and unrelated to the AME business,
such as a personal diary or rolodex.
7. NON-SOLICITATION AND NON-COMPETITION. During the "Restriction Period"
(as hereinafter defined) and within the "Territory" (as hereinafter
defined), the Employee shall not directly or indirectly, compete with AME
or NRC with respect to the AME Business and the Employee shall not (i)
solicit the business of AME from any customer of AME or any entity
controlled by AME; (ii) directly or indirectly, hire any employees of AME
or any entity controlled by or controlling AME or cause any entity with
which the Employee is affiliated to hire any such employees of AME; (iii)
engage in, represent in any way or be connected with, as a consultant,
officer, director, partner, employee, sales representative, proprietor,
member, stockholder (except for stock ownership of less than 1% in a
publicly owned corporation) or otherwise, any business competing with the
business of AME as conducted by AME on the date hereof or during the period
of Employee's employment by AME.
As used herein, the "Restriction Period" shall mean the period while
the Employee is employed by AME and the period following termination of
employment as determined below:
(i) Twenty-four (24) months after the date the Employee
ceases to be employed by AME if such employment
terminates within two (2) years of the date hereof;
(ii) Eighteen (18) months after the Employee ceases to be
employed by AME if such employment terminates after two
(2) years from the date hereof and before three (3)
years from the date hereof;
(iii) Twelve (12) months after the Employee ceases to be
employed by AME if such employment terminates after
three (3) years from the date hereof and before four
(4) years from the date hereof;
(iv) Nine (9) months after the Employee ceases to be
employed by AME if such employment terminates after
four (4) years from the date hereof and before five (5)
years from the date hereof;
(v) Six (6) months after the Employee ceases to be employed
by AME if such employment terminates after five (5)
years from the date hereof.
As used herein, the "Territory" shall mean the United States of America and
any other country in which AME does business after the date hereof while
Employee is employed by AME or NRC and its subsidiaries. As used herein,
the term "employees" shall mean persons who are, at the time in question,
current employees of AME or its affiliates or who were, within six (6)
months of the date of the prohibited hiring, employees of AME or its
affiliates. For this purpose, affiliates of AME shall include NRC and its
subsidiaries.
8. NO CONFLICT.
Employee represents and warrants that he is not a party to or
otherwise subject to or bound by the terms of any contract, agreement or
understanding which in any manner would limit or otherwise affect his
ability to perform his obligations hereunder, including without limitation
any contract, agreement or understanding containing terms and provisions
similar in any manner to those contained in Sections 6 and 7 hereof.
9. SURVIVAL OF COVENANTS; EFFECT.
(a) REMEDY. The covenants on the part of the Employee contained or
referred to in Sections 6 and 7 above shall survive termination of this
Agreement, and the existence of any claim or cause of action of the
Employee against AME, whether predicated on this Agreement or otherwise.
The Employee agrees that a remedy at law for any breach of the foregoing
covenants contained or referred to in Sections 6 and 7 would be inadequate,
that AME would suffer irreparable harm as a result and that AME shall be
entitled to a temporary and permanent injunction or an order for specific
performance of such covenants without the necessity of proving actual
damage to AME and without the posting of any bond or other security. Any
breach (whether or not material) by AME shall not release the Employee from
his obligations under Sections 6 and 7.
(b) REASONABLENESS. The Employee hereby represents and acknowledges
that AME is relying on the covenants in Sections 6 and 7 in entering into
this Agreement and that the restrictions in Sections 6 and 7 are fair and
reasonable. The Employee acknowledges that AME presently intends to do
business throughout the United States and that the geographic scope of the
covenants in Section 7 is reasonable and necessary to protect the interests
of AME. The Employee acknowledges that the restrictions in Sections 6 and
7 are a material inducement to NRC to enter into the Purchase Agreement.
(c) CARE. It is the intent of the parties that the provisions of
Sections 6 and 7 shall be enforced to the fullest extent permissible under
the laws and public policies of each jurisdiction in which enforcement is
sought. If any particular provision of Sections 6 and 7 shall be
adjudicated to be invalid or unenforceable, such provision(s) of Sections 6
and 7 shall be deemed amended to provide restrictions to the fullest extent
permissible and consistent with applicable law and policies, and such
amendment shall apply only with respect to the particular jurisdiction in
which such adjudication is made. If such deemed amendment is not allowed
by the adjudicating body, the offending provision, only, shall be deleted
and the remainder of Sections 6 and 7 shall not be affected.
10. ASSIGNMENT.
The rights and obligations of AME under this Agreement may be assigned
or delegated by AME to any affiliate of AME or to any successors in
interest of AME or of that part of the business of AME to which this
Agreement applies so long as the duties of Employee are not materially
affected. Any other assignment of this Agreement shall require the written
consent of Employee. After the date hereof, AME may change its name and
such name change shall not affect the rights and duties of the parties
hereto. This Agreement may not be assigned and any duties of the Employee
may not be delegated by the Employee, but any amounts owing to the Employee
upon his death shall inure to the benefit of his estate. In the event of
any merger or other corporate reorganization of AME wherein AME is not the
surviving entity, provisions reasonably satisfactory to Employee shall be
made to ensure the Employee that the compensation and other benefits of
this Agreement are not diminished thereby.
11. NOTICES.
All notices or other communications which may be or are required to be
given, served or sent by either party to the other party pursuant to this
Agreement shall be in writing, addressed to its/his residence or place of
business as set forth above, and shall be mailed by first-class certified
mail, return receipt requested, postage prepaid, next-day air delivery, or
transmitted by facsimiles or hand delivery. Such notice or other
communication shall be deemed sufficiently given, served, sent or received
for all purposes at such time as it is delivered to the addressee or at
such time as delivery is refused by the addressee upon presentation. Each
party may designate by notice in writing an address to which any notice or
communication may thereafter be so given, served or sent.
12. APPLICABLE LAW JURISDICTION.
This Agreement shall be governed by, construed and enforced in
accordance with the internal substantive laws and not the choice of law
rules of the State of Delaware.
13. EFFECTIVENESS/INTERPRETATION.
The parties acknowledge and agree that this Agreement has been
negotiated at arm's length between parties equally sophisticated and
knowledgeable in the matters dealt with herein. Each party has been
represented by counsel of its or his own choosing. Accordingly, any rule
of law or legal decision that would require interpretation of any
ambiguities in the Agreement against the party that drafted it is not
applicable and is waived.
14. SEVERABILITY.
If any of the articles, sections, paragraphs, clauses or provisions of
this Agreement shall be held by a court of last resort to be invalid, the
remainder of this Agreement shall not be affected thereby.
15. ENTIRE AGREEMENT.
The foregoing contains the entire agreement between the parties
relating to the subject matter of this Agreement, and may not be altered or
amended except by an instrument in writing approved by AME and signed by
the parties hereto, and this Agreement supersedes all prior understandings
and agreements relating to employment of the Employee by AME. The waiver
of any rights under this Agreement on any one or more occasions shall not
constitute a waiver on any subsequent occasion.
IN WITNESS WHEREOF, AME has caused this Agreement to be executed by
its duly authorized officers and the Employee has hereunto set his hand as
of the date first above written.
ADVANCED MARINE ENTERPRISES, INC.,
a Virginia corporation
John T. Drewry
By: ____________________________
Its President
NICHOLS RESEARCH CORPORATION,
a Delaware corporation
Chris H. Horgen
By: ____________________________
Its Chief Executive Officer
Otto P. Jons
________________________________
OTTO P. JONS, Employee
SCHEDULE I
A. DUTIES OF EMPLOYEE--EXECUTIVE VICE PRESIDENT
1. BUSINESS DEVELOPMENT: Identify and/or create business
development opportunities; make bid decisions and develop
proposed strategies; execute public and customer relation
programs.
2. PRODUCT DEVELOPMENT: Oversee product development performed by
division directors and integrate them as appropriate; perform a
continuing review of product development processes with the
objective of improvement and innovation.
3. PERSONNEL DEVELOPMENT: Use recruited as well as internal
personnel development and training to maintain a stable base of
talented, qualified and motivated professionals.
4. QUALITY MANAGEMENT: Maintain a quality management program as a
prerequisite for Items 1 through 3 above.
5. ADMINISTRATION: Execute, as appropriate, the responsibilities
for company-internal operation, including contract management,
facility management, administrative support and related
functions; develop and/or maintain documentation on standards,
policies and practices.
6. TECHNOLOGY DEVELOPMENT: Member of the NRC Technology Development
Council.
B. AUTHORITIES OF EMPLOYEE
Consistent with NRC objectives, business plans and operating budgets
formulated for the AME business unit and within the constraints
developed by the AME Board of Directors to ensure continuing cost
competitiveness:
1. Authorize expenditures for capital investment in infra-structure,
such as tools/computer technology, techniques and advanced
methods.
2. Authorize salaries and employee compensation package to attract
and retain qualified personnel.
3. Other as assigned.